• We finally got some economic news today, all of it bad
  • All of it “unexpected”…
  • Hope springs eternal on Wall Street
  • That’s why the Federal Reserve can maintain its forecast of an interest rate hike before the end of the year
  • Although now a second Fed official has come out saying he doesn’t think a rate hike will be appropriate this year
  • All this was forecasted by me; there was a method to their madness to maintain the theater that a rate hike is even possible
  • When is the Fed going to admit that their earlier forecast of a big recovery and liftoff is wrong?
  • CNBC finally admitted they do not want me on because I correctly predicted that the Fed would not raise rates
  • The same is true for Bloomberg
  • However,  the last time I was on Fox Business, that video on my YouTube Channel got over 80,000 views
  • That is probably more people who viewed the live show!
  • By the way, don’t forget to like me on Facebook follow me on Twitter and and subscribe to my YouTube Channel
  • It’s not going to be too much longer before more and more people will agree the Fed is not going to raise rates
  • If I am right and the Fed launches QE4, it will be hard for the conventional media to ignore me – I am not saying it will be impossible, though
  • These podcasts are developing a greater and greater audience, and you can help spread the word by sharing them, to get the word out
  • Let’s get to the economic data, starting with the Weekly Mortgage Applications
  • This number was significant in the precipitous 27.6% drop in the composite index with purchased mortgages dropping 34%
  • Part of this was due to last week’s big jump as mortgage applicants tried to get ahead of new government rules
  • But the drop is much bigger than the pop – this is a bad sign
  • The consensus forecast for the Producer Price Index was for month over month prices to drop .2% instead they dropped .5%
  • Year over year, down 1.1%; last month it was down .8%
  • This is bad news to the Fed, which is looking for higher inflation
  • The real negative news was the September Retail Sales Number
  • It was expected to be weak, up only .1 and that’s what we got, but last month’s .2 number was revised down to flat
  • Now we’re up .1 from zero, meaning August and September Retail Sales missed expectations
  • This will pull numbers away from Q3 GDP
  • I think we will get Q3 GDP below 1%
  • It might be below zero, which will be the first half of a recession
  • We also got Business inventories, which were unchanged, but the inventory ot sales ration popped up to 1.37 – that ties the high for the move
  • This glut of product is bad news for the economy
  • The last 2 times we had inventory to sales ration this high, we were already in recession – 2001 and 2008
  • The worst news was Walmart’s bombshell announcement that profits are suffering due to labor costs
  • Their sales are suffering, too
  • 75% of the losses are due to higher wages and the balance came from lower sales
  • Walmart is the nation’s biggest retailer and should benefit most from a stronger dollar and cheap gas
  • Walmart’s stock was down 10% on the day, one of the worst days in the history of Walmart
  • YTD, it is down 33% from its highs – a super bear market for Walmart
  • The Left proclaims that Walmart is getting rich on the backs of the workers – a collapse in Walmart stock price is not good for workers because profits are what creates the jobs
  • This is a sign – Walmart is where America shops – if Walmart is having a problem, other retailers are having problems
  • I predicted that we would get a pop in the market out of the jobs number but I did not think it would make a new high – that’s what happened
  • In order for the market to reach a new high, it needs QE4
  • As a result of this bad news, we got a decline in the market
  • The Dow was down 160 points, but gold had a great day
  • Gold was up about $20 Silver was up above $16
  • The Gold Stocks Index (GDX) was up 7% on the day
  • Oil stocks were higher
  • Emerging market stocks were up
  • Foreign markets are now moving inversely to the U.S. market
  • This is exacerbated by the dollar weakness, which is just getting started
  • Dollar index closed down almost a full percent today
  • The Euro was close to to 1.15
  • the New Zealand dollar was up 2.5% on the day
  • The dollar rally was built on the foundation of expected rate hikes
  • When that unwinds, and gold gets above 1200, it is going to pop
  • There is a lot more bad news coming and the speculative money will need to cut and run on the long side of the dollar and the short side of gold
  • I expect the physical gold shortages to intensify
  • Buyers who want gold delivered to them will find it harder and harder to find, and they may encounter spike in premiums
  • If you’re thinking about buying physical, stop thinking and start buying, because not only will the price rise, but so will the premiums, making it a double-whammy